The Focus Party was fined $150 for failing to pay sales tax on campaign items. The party used a U account to pay for fliers at a local printing business, which made it tax exempt.
The Election Committee reduced the fine from $500 to $150, but said that it was necessary to hold the party accountable for its financial actions and set precedence for future elections, as well as to show respect for the U.
This fine puts the campaign over their allotted $1,800 budget for party expenses, and $50 is being charged for going over that amount. Focus campaign manager Kariann Hibbard said she does not know if Focus will appeal the decision, but she is “up in arms” because the party will have to pay the fee out of its members own pockets, which she said undermines the Associated Students of the University of Utah’s goal to organize an election that doesn’t require candidates to pay their own way.
Hibbard said the tax exemption was the result of a “large misunderstanding” on the part of the AlphaGraphics, the company they ordered fliers from, which assumed the party would be paying with a university account.
When an employee asked Hibbard if she had an account, Hibbard said she thought the employee was referring to the party’s debit account, but AlphaGraphics charged the order to a U account and did not include sales tax. When Hibbard realized the party hadn’t paid for the fliers, the party charged the amount to its debit account, but did not realize they had not paid sales tax until elections financial auditor Melissa Green pointed it out to her late Wednesday night. Hibbard went back to AlphaGraphics to pay the sales tax yesterday afternoon.
According to elections rules, parties are not recognized as part of ASUU or the U. Hibbard said she thought she had made this clear to AlphaGraphics when she made the purchase.
“We never gave them a tax ID number. We never told them we’re tax-exempt — it was a misunderstanding,” Hibbard said.
When Green spoke to Focus presidential candidate Patrick Reimherr, she said he admitted the exemption was a mistake. Reimherr also explained that other party purchases were tax-exempt because they were made online or with out-of-state companies, therefore making them tax-exempt under inter-state commerce laws.
Green said she was concerned that the incident with AlphaGraphics would present liability issues for the U and ASUU.
Andy Murphy, who defended the Focus Party at last night’s grievance hearing, said the fault lies with AlphaGraphics, but the party did everything they could to rectify the situation.
“Putting ASUU in liability is something AlphaGraphics did,” Murphy said. “It’s unfair for us to be so slapped across the face for something a firm did to us, that was a mystery until it was revealed to us.”
Murphy said that in the elections two years ago, the BLOC Party went to the Hinckley Institute of Politics to acquire a tax exemption code and saved $1,500 on their banners because of it.
“We did not seek a tax number,” he said.
Members of the Elections Committee argued that the party should be held accountable.
“I think you have to take some responsibility and not put it all on AlphaGraphics,” Brandon Patterson, a member of the committee, told the Focus defense team.
Reimherr and his vice-presidential candidate Jon Hayes were not present at the hearing. Party members said they were campaigning.
Focus was also fined for exceeding allotted budgets for the president, senior class and some senate candidates. They accepted this grievance and will be fined $105, the amount they went over. The party was also fined $30 for not having receipts for some party supplies.
The Spork Party was fined $20 for turning in its financial disclosures late and another $20 for being late on turning in their late fee. The party has already paid both fees. Spork was also fined for two Assembly candidates going over budget, and were charged $5.70 for each candidate. They also did not allocate their funds correctly to account for their fliers and must reallocate their funds.
All fines and charges must be paid today by 9:30 a.m.
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